U.K. Stocks Drop for a Third Day as Shire Plunges

June 25 (Bloomberg) -- U.K. stocks retreated for a third
day as investors awaited a summit of European Union leaders
later this week in Brussels.

Shire Plc tumbled 11 percent, the largest decline on the
benchmark FTSE 100 Index, after the Food and Drug Administration
approved a generic version of its second-biggest selling
treatment for use in the U.S. SABMiller Plc fell 1.7 percent
after the stock was downgraded.

The FTSE 100 dropped 63.04, or 1.1 percent, to 5,450.65 at
the close in London, extending its slide from the beginning of
this year to 2.2 percent. The gauge has declined 5.5 percent so
far this quarter. The broader FTSE All-Share Index lost 1.2
percent today, while Ireland’s ISEQ Index slipped 0.9 percent.

“In this febrile atmosphere, there is little that seems
capable of lifting markets from their gloom,” Chris Beauchamp,
a market analyst at IG Index in London, wrote in a note. “With
yields on Spanish and Italian bonds creeping higher once again,
the stage is now being well set up for this week’s summit.”

U.K. stocks slipped 1 percent on June 22 led by a selloff
in mining and energy companies, as base metals dropped amid
signs of a global economic slowdown.

The volume of shares changing hands on FTSE 100 companies
was 14 percent lower than the average of the last 30 days, data
compiled by Bloomberg showed.

Germany will face an increasingly united bloc of euro-area
nations demanding more ambitious policies to help the currency
zone’s most debt-stricken members. The leaders of the 27 EU
states will attend pre-summit meetings as they work to narrow
their differences before the June 28-29 meeting.

A report today showed that demand for new houses in the
U.S. increased in May more than economists had estimated. Sales
climbed to a 369,000 annual rate, 7.6 percent higher than the
343,000 pace in April. That beat the median estimate of 347,000
in a Bloomberg News survey.

Shire slumped 11 percent to 1,743 pence after the FDA
approved a generic version of the drugmaker’s attention-deficit
hyperactivity disorder treatment Adderall XR. Brian Bourdot, an
analyst at Barclays Plc, cut his profit forecast for the Dublin-based company by 14 percent.

SABMiller Slips

SABMiller, the world’s second-biggest brewer by volume,
fell 1.7 percent to 2,462.5 pence. The stock was cut to sell
from hold at Liberum Capital Ltd. The brokerage cited the
increased likelihood that Anheuser-Busch InBev NV, the world’s
largest brewer, will buy Grupo Modelo SAB.

BT Group Plc, the U.K.’s largest fixed-line telephone
company, dropped 2 percent to 201 pence. The stock was
downgraded to neutral from buy at Citigroup Inc.

Essar Energy Plc, an Indian power producer and oil refiner
that trades in London, tumbled 7.8 percent to 116 pence after
the High Court of Gujarat rejected the company’s petition to
change a tax ruling. Essar said it may appeal to the Supreme
Court of India.

Morrison Slips

William Morrison Supermarkets Plc, the smallest of the
U.K.’s four biggest supermarket chains, slid 1.3 percent to
264.8 pence, its fifth day of losses. The company said Richard
Pennycook, its group finance director, will leave at the end of
June 2013.

BHP Billiton Ltd. fell 2.5 percent to 1,726 pence and Rio
Tinto Group slipped 3.7 percent to 2,872.5 pence as UBS lowered
its earnings estimates for both companies by 4 percent because
of Australia’s taxes on mining and carbon.

Cohort Plc surged 21 percent to 107.5 pence, its biggest
rally in a year. The British provider of technical services to
defense and security companies reported full-year profit of 4.6
million pounds ($7.2 million). Cohort also said one of its units
won a five-year extension for a managed IT services contract
from a joint venture led by the Ministry of Defence.

ITM Power Plc advanced 6.3 percent to 56.75 pence. The
fuel-cell developer said it sold its first hydrogen-generation
system to the European Aeronautic Defence & Space Co.